United States Court of Appeals
For the First Circuit
No. 05-2425
UNITED STATES OF AMERICA,
Appellee,
v.
CARLOS H. SOTO-CRUZ,
Defendant, Appellant.
APPEAL FROM THE UNITED STATES DISTRICT COURT
FOR THE DISTRICT OF PUERTO RICO
[Hon. Carmen Consuelo Cerezo, U.S. District Judge]
Before
Boudin, Chief Judge,
Torruella, Circuit Judge,
and Hansen,* Senior Circuit Judge.
Héctor L. Ramos-Vega, Research and Writing Specialist, with
whom Patricia A. Garrity, Assistant Federal Public Defender, and
Joseph C. Laws, Jr., Federal Public Defender, were on brief, for
appellant.
Marcos López, Assistant United States Attorney, with whom
Jacqueline D. Novas, Assistant United States Attorney, Nelson
Pérez-Sosa, Senior Appellate Assistant United States Attorney, and
H.S. García, United States Attorney, were on brief, for appellee.
June 7, 2006
*
Of the Eighth Circuit, sitting by designation.
HANSEN, Senior Circuit Judge. Carlos H. Soto-Cruz appeals the
144-month sentence he received after he pleaded guilty to mail and
securities fraud. See 18 U.S.C. §§ 1341, 1348. Because Soto-Cruz
knowingly and voluntarily waived the right to appeal his sentence
in his plea agreement, we dismiss his appeal.
I.
Soto-Cruz, who worked his way out of a poor and troubled
childhood to earn a Ph.D. in philosophy, became a registered
stockbroker in 1989 for Paine Webber. He later worked for Dean
Witter Reynolds, Inc., which eventually merged with Morgan Stanley.
In 1991, Soto-Cruz began what turned into a twelve-year-long scheme
to defraud his clients out of at least $58 million. He advised at
least ten different individual and institutional clients to invest
in low-risk securities, including mortgage-backed securities issued
by the Government National Mortgage Association (GNMA). He then
funneled his clients' investments through fictitious corporate
accounts that he opened and controlled and into high-risk
investments, keeping the profits of the risky investments for
himself. Soto-Cruz was able to perpetuate the scheme for nearly
thirteen years, through the Dean Witter/Morgan Stanley merger, and
even while working under several different supervisors. Soto-
Cruz's scheme resulted in actual losses to his clients, including
at least two banks, of more than $10 million.
Soto-Cruz was indicted for thirty-six counts of mail, wire,
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and securities fraud in March 2004. On October 4, 2004, Soto-Cruz
entered into a written plea agreement, in which he agreed to plead
guilty to counts one through twenty (alleging separate counts of
mail fraud) and count thirty-six (alleging securities fraud). He
also agreed to forfeit $51 million worth of real estate and bank
accounts. The government agreed to dismiss the remaining counts.
The plea agreement contained a stipulation of the applicable U.S.
Sentencing Guidelines (USSG) factors, including a 20-level
enhancement for an actual loss exceeding $7 million, and a
stipulation to the resulting sentencing range of 121 to 151 months.
The government agreed to recommend a sentence at the lower end of
the agreed-upon applicable sentencing range.
Soto-Cruz entered into the plea agreement after the Supreme
Court decided Blakely v. Washington, 542 U.S. 296 (2004). The plea
agreement specifically provided "that the Court shall impose a
sentence in accordance with the applicable provision(s) of the
Sentencing Guidelines" (Appellant's App. at 52), and stated that
the "defendant is aware that the defendant's sentence is within the
sound discretion of the sentencing judge and will be imposed in
accordance with the Guidelines" (Id. at 53). Soto-Cruz agreed "to
waive all rights under Blakely," and "agree[d] to have his sentence
determined under the Sentencing Guidelines." (Id.) Finally, Soto-
Cruz agreed that if the court "accept[ed] this agreement and
sentence[d] him according to its terms and conditions, [he]
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waive[d] and surrender[ed] his right to appeal the conviction and
sentence." (Id. at 62.)
The district court held a change of plea hearing on October 7,
2004, and accepted Soto-Cruz's guilty plea. Soto-Cruz was
sentenced in April 2005, after the Supreme Court decided Booker v.
United States, 543 U.S. 220 (2005). The district court applied the
Guidelines as advisory, as required by Booker. Despite the
government's recommendation for a 121-month sentence, the district
court sentenced Soto-Cruz to 144 months of imprisonment after
considering the now advisory Guidelines range (121 to 151 months)
and the other 18 U.S.C. § 3553(a) sentencing factors. Soto-Cruz
appeals his sentence.
We agree with the government that Soto-Cruz validly waived his
right to appeal his sentence. "[P]lea-agreement waivers of the
right to appeal from imposed sentences are presumptively valid (if
knowing and voluntary)," subject to our inherent power to disregard
them in order to avoid a miscarriage of justice. United States v.
Teeter, 257 F.3d 14, 25-26 (1st Cir. 2001). Soto-Cruz "candidly
admit[s] that he entered into the waivers knowingly and
voluntarily." (Reply Br. at 11.) He argues, however, that the
district court's statement at the end of his sentencing hearing –
that he had the right to appeal his sentence if he thought it to be
illegal or unreasonable – negated the plea waiver. See Teeter, 257
F.3d at 26-27 (declining to enforce a plea agreement appeal
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waiver).
In Teeter, we were concerned that contradictory statements by
a district court about a defendant's right to appeal despite an
appeal waiver may call into question the requirement that a waiver
must be knowing and voluntary. In Teeter, the district court
failed to ensure at the change of plea hearing that the defendant
understood the consequences of the appeal waiver, as required by
the then-recent amendments to Rule 11 governing plea colloquies.
The court compounded that error at the sentencing hearing by
stating without qualification that the defendant had "a right to
appeal any sentence I impose." Teeter, 257 F.3d at 27. We held
that the district court's failure to discuss the appeal waiver,
coupled with the inconsistent statements at the sentencing hearing,
called into question whether the defendant's surrender of her right
to appeal was sufficiently informed to bind her. Id.
In this case, Soto-Cruz "concede[s] that the Magistrate Judge
carefully addressed him at the [October 2004] plea hearing to make
sure he understood the implications and consequences of the
waivers." (Reply Br. at 12.) Consequently, unlike Teeter, there
are no Rule 11 issues or concerns in this case. At the April 2005
sentencing hearing, the district court informed Soto-Cruz that he
could appeal his sentence if he thought the sentence violated the
law or was unreasonable. We held in Teeter that
[w]hile broad assurances to a defendant who has waived
[his] appellate rights (e.g., "you have a right to appeal
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your sentence") are to be avoided – they muddy the waters
and tend to instill false hope – they do not effect a per
se nullification of a plea-agreement waiver of appellate
rights.
Teeter, 257 F.3d at 25. The context in which such a statement is
made is important to our determination of whether the statement is
sufficiently contradictory to an already agreed-upon, examined, and
accepted appeal waiver so as to render the waiver nugatory. See
United States v. De-La-Cruz Castro, 299 F.3d 5, 11-12 (1st Cir.
2002).
The district court's statement in this case is not such a
"broad assurance." Rather, its statement about Soto-Cruz's appeal
rights was limited to the appeal of a sentence that Soto-Cruz
thought was in violation of the law or was unreasonable. Courts
have long recognized that appeal waivers do not prevent a defendant
from appealing a sentence that would result in a miscarriage of
justice, such as a sentence imposed in violation of the law. See
United States v. Johnson, 347 F.3d 412, 414 (2d Cir. 2003)
(refusing to enforce appeal waiver against defendant's claim that
his sentence was based on a constitutionally impermissible factor),
cert. denied, 540 U.S. 1210 (2004); United States v. Andis, 333
F.3d 886, 892 (8th Cir.) (en banc) (recognizing a narrow exception
to the enforceability of an appeal waiver for an allegedly illegal
sentence), cert. denied, 540 U.S. 997 (2003). Thus, the district
court's statement about the limited circumstances under which Soto-
Cruz could appeal his sentence does not negate the enforceability
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of his appeal waiver. See De-La-Cruz Castro, 299 F.3d at 12
(holding that the district court's statement that the defendant
could appeal his sentence "under some circumstances" was correct
insofar as waivers do not prevent the correction of a miscarriage
of justice, and thus the statement did not negate the defendant's
appeal waiver).
Alternatively, Soto-Cruz argues that enforcement of the appeal
waiver would work a miscarriage of justice because the district
court denied his request to present, in a closed hearing,
mitigation evidence and evidence of his background. According to
Soto-Cruz, enforcement of agreed-upon mandatory Guidelines to his
post-Booker sentence would likewise work a miscarriage of justice.
"The miscarriage of justice reservation 'will be applied sparingly
and without undue generosity.'" De-La-Cruz Castro, 299 F.3d at 13
(quoting Teeter, 257 F.3d at 26). Some considerations that guide
our determination include the clarity, gravity, and character
(i.e., factual or legal) of the error; the impact of the error on
the defendant and on the government; and whether the defendant
consented to the result. Teeter, 257 F.3d at 26.
We agree with the district court that the proposed mitigation
evidence would not have affected Soto-Cruz's sentence. Soto-Cruz
wanted to introduce evidence at the sentencing hearing that tended
to show that others were responsible for part of the losses in an
effort to reduce the agreed upon and stipulated to 20-level
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increase to his base offense level. He belatedly claims that he
was pressured by his supervisors to continue his scheme, and that
the failure of Morgan Stanley's internal controls to expose his
wrongdoing increased the amount of the losses. Such evidence would
have been directly contradictory to his signed plea agreement, in
which Soto-Cruz agreed that the actual losses from his conduct
exceeded $10 million and further specifically agreed to the 20-
level enhancement for a loss of between $7 million and $20 million.
Soto-Cruz also explicitly agreed to the resulting 121- to 151-month
sentencing range. A defendant waives his right to challenge
sentencing factors when he stipulates to the facts supporting the
sentencing factor. See United States v. Serrano-Beauvaix, 400 F.3d
50, 54 (1st Cir.), cert. denied, 126 S. Ct. 106 (2005). Indeed,
such a challenge would likely result in a breach of the agreement
by the defendant. See United States v. Rodríguez-González, 433
F.3d 165, 168 (1st Cir. 2005) ("[A] special problem exists where .
. . a defendant seems to disavow his stipulations without seeking
to set aside the plea agreement."). Denying Soto-Cruz the
opportunity to introduce evidence that would have contradicted the
stipulations he made in the plea agreement and solemnly affirmed in
open court at his plea proceeding did not work a miscarriage of
justice.
We likewise reject Soto-Cruz's claim that the Supreme Court's
Booker decision, issued after Soto-Cruz entered into his plea
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agreement and before the district court sentenced him, somehow
renders enforcement of his appeal waiver a miscarriage of justice.
Soto-Cruz explicitly recognized that the constitutionality of the
Guidelines was in question at the time he entered into his plea
agreement, and he agreed to waive his right to appeal his sentence
as well as any claims under Blakely. Indeed, the Magistrate Judge
advised Soto-Cruz at his change of plea hearing that the Supreme
Court had heard argument in Booker the prior Monday, stating that
"[n]obody knows how the Supreme Court will rule on that, but I do
have to advise you that in theory you may have several rights . .
. but at this time you are waiving any rights to have the jury
determine your sentencing guideline calculations, if that were to
be the law as determined by the Supreme Court." (Appellee's Br. at
18 (quoting the change of plea hearing).) When asked if he
understood that he was waiving the possibility of the Supreme Court
so holding, Soto-Cruz responded, "Thoroughly and several times,
yes." (Id.)
That the Supreme Court decided Booker differently than Soto-
Cruz (or most of us) anticipated does not make his plea agreement
unknowing or involuntary. Indeed, other Courts of Appeals have
held defendants to appeal waivers that were entered into prior to
Blakely. See, e.g., United States v. Griffin, 418 F.3d 881, 882
(8th Cir. 2005) ("The fact that [the defendant] did not anticipate
the Blakely or Booker rulings does not place the issue outside the
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scope of his waiver." (internal marks omitted)); United States v.
Cardenas, 405 F.3d 1046, 1048 (9th Cir. 2005) (rejecting a claim
that an appeal waiver entered in 2000 was invalidated by Booker's
change in the sentencing laws because "a change in the law does not
make a plea involuntary and unknowing"). Unlike the defendants in
those cases, Soto-Cruz was sentenced pursuant to Booker under an
advisory Guidelines regime. Because he received the benefit of
Booker, the waiver of any Blakely claims cannot have resulted in a
miscarriage of justice.
Nor can Soto-Cruz's claim that his sentence is unreasonable
satisfy the miscarriage of justice exception. Based on the
Guidelines range and the other § 3553(a) factors, the district
court imposed a sentence slightly above the middle of the advisory
Guidelines range. We recently explained that although a within-
Guidelines range is not "per se reasonable," "the [G]uidelines
cannot be called just 'another factor' in the statutory list."
United States v. Jimenez-Beltre, 440 F.3d 514, 518 (1st Cir. 2006)
(en banc). Soto-Cruz engaged in a very long-term fraudulent
scheme, using his relationship of trust as a stockbroker to defraud
his clients and friends, the betrayal of which, in his own words,
amounted to treason. While he is now very remorseful, he only
admitted to his conduct after being caught. That others within his
organization may have encouraged him or failed to stop him does not
change his own culpability. A much belated and half-hearted
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assertion that "the boss made me do it" does not negate the
extensive acts Soto-Cruz took to perpetuate his fraud. The
sentence imposed is not unreasonable and does not result in a
miscarriage of justice. The appeal waiver is enforced, and the
appeal is dismissed.
Dismissed.
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